3.
Welcome to 2012• Tom Friedman recently wrote “…we are leaving an era of some 50 years duration in which to be a president, a governor, a mayor or a college president was, on balance, to give things away to people; and we are entering an era — no one knows for how long — in which to be a president, a governor, a mayor or a college president will be, on balance, to take things away from people.

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Welcome to 2012• “Outside of a handful of wealthy, privately endowed universities, I think a lot of presidents just find that the jobs aren’t that satisfying anymore,” said James C. Garland, former president of Miami University of Ohio and author of Saving Alma Mater. “A lot of these people went into administration hoping to build something, and instead they are desperately trying to stay afloat.”

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Dayton Arts Survival: “interesting but probably impossible”• “Certainly speaking for the orchestra, we had made, I think, every conceivable cut that wasnt draconian.”• “So we wondered, could it be done differently?”• “People thought it sounded a little bit interesting but probably impossible, which is frankly what I thought. But again, I figured as long as were looking at the business model, why not look at the business model.”• “Arts organizations across the country are trying to find new ways of doing business.”• “To me it looks like a period of great, great transition. And in some ways, that means its a little messy. We see an unprecedented amount of experimentation.”

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Healthcare: Tackling a Behemoth• Jim Reed will spend the next several years trying to take what were once three separate health care nonprofits and create a national model for progressive health care delivery.• For some this might sound impossible : “it can’t be done”• WHY Thats because the local health care system had been so fragmented in the past, with overlapping facilities and services that didnt mesh well enough to ensure continuity of care• RISK Pace of Change: Reed admits that based on his private-sector business experience, which was at companies like International Paper and Union Pacific before he went to medical school, it can take five years in some instances. – Reed cant say what St. Peters Health Partners will look like five or 10 years from now – BUT "The quality of care is going to be better," Reed said. "And clearly, we can be more cost-efficient with it."

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Higher EducationMyopia and hubris• “Not enough of a crisis”• “Unfortunately, families will have to pay more”Search for solutions• Illusory strategies that externalize solutions – NEW MARKETS! MOOCS! – and take focus off sacred cows • "Everyone knows education has to change, and the knee-jerk reaction is to say that MOOCs are going to save us"• “We must HAVE VALUE and BETTER COMMUNICATE IT!” • NOT SO FAST… can we “sell” our way out of this? – Despite growing skepticism, most are “sold” but UNABLE or UNWILLING to pay “out of control prices”• “I am not optimistic that many of us have the courage to move beyond adjusting the current tactics.” CAO NAC&U

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Past as Prelude: What Can Recent Trends Tell Us?Surveying mid-prestige/high-price private colleges,early indicators reveal post-2008 trends: – overall application decreases as high as 20% – inside those gross numbers, financial aid applications dropped by 5-10% while, – “full-pay” applications decreased by a factor of three or four times as muchSome showing price UP, discount UP and per-familycost DOWN, academic quality DOWN – NTR UP only because they are growing class size…for now

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Affluent Students: Attributes to consider a college that’s not my first choiceIncreasingly cost sways students and parents to lower-choice colleges. Source: Cappex July 2012 Survey: N= 1,270 Parents and 1,200 Students; Affluent income: $100k to more than $250k

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Future Check: from unwilling to unable to priced-out in a generation• Across the affluence spectrum, ability and willingness to pay is decreasing at best.• As ability to pay increases, willingness to pay decreases: – more and more students are going to their “second choice” colleges because of cost.• If the more-affluent current parents are balking at paying today’s costs what will the next generation of parents do? – …the first American generation pundits predict less well off than their parents….• The next cohort of less-affluent parents will have an even more difficult time paying if college prices freeze today.

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The Choice: Lead or Follow• Wait for market forces? – Family choice• Wait for regulatory forces? – Government money• Wait for retirement? – Opportunity won’t be better, later• Or accept stewardship responsibility and lead change from a position of strength and knowledge?

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The Choice to Lead• Wesleyan – Wesleyan University announced that it was moving away from need- blind admissions. – Established a three-year bachelor degree.• Grinnell: President Raynard Kington on reviewing need-blind admissions – “I think everybody realizes that something has to change or that well have to face even tougher choices down the road.”• Sage – 4 year tuition freeze • a gain of $13M NTR• Concordia – 33% topline price slash

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So What Do We Do?• Take action: we are not “just” recruiters and counselors – Bridging the on- and off-campus constituencies, we are valuable sources of information• Return home and announce your newly-realized authority with commitment, passion, and intelligence – Work creatively with on-campus colleagues to find sustainable situation-appropriate solutions, take “prudent risks” – Forge community partnerships to nurture the “supply chain” – Have your president’s back and use data to urge leadership to: • accept their stewardship responsibility to objectively and creatively look to the future • “Those were the days…” and they are gone – Proclaim that New Normal rewards are success more than comfort – Help people understand that accepting reality is not lowering ambition